British investor in talks to buy 49% share in Teesside International Airport

British investor Michael Flacks has said he is in talks to acquire a 49 per cent stake in North East England’s Teesside International Airport as part of plans for significant investment in the region.

The airport was nationalised in 2019 by Tees Valley’s Conservative mayor Lord Ben Houchen, under a flagship and highly electorally popular local pledge that was intended to secure its future as a passenger hub.

Local authorities jointly paid £40mn for the acquisition from Peel Holdings. The airport has remained lossmaking and has since received repeated local public sector bailouts.

Flacks, a Manchester-born dealmaker focused on corporate turnarounds, said he was in discussions about buying a minority share in the airport and would plan further investment to build it out into a cargo, repair and maintenance hub, pivoting away from passenger flights.

The proposed deal would value the airport at £40mn, the same price paid by local government five years ago.

“It ticks all the boxes,” he said in an interview with the Financial Times. “It’s a long-term, significant investment.”

Flacks said the deal, which he hopes to close by the end of August, would make sense for the local taxpayer. “They’ve been losing money for years,” he noted, adding he wanted to make the airport “profitable”.

“The way to make it profitable is do differently to what they’re doing,” he said. “It’s not that they’re not doing a good job, but running a passenger airport is a hopeless exercise.”

In a video posted on Facebook on Friday, Houchen said: “I don’t think we should ever be selling our airport . . . We’ve been approached periodically.”

Under the deal envisaged by Flacks, he would have operational control of the airport while the local councils, which own the remaining 51 per cent, would continue as a “silent partner”.

If successful, he said he would further invest in the airport to build out new facilities such as hangars. He said he would only aim to slightly increase annual passenger traffic.

“My offer isn’t just about buying it, it’s about developing it for further use,” he said.

Founded in 1983, the Flacks Group owns companies including Kelly-Moore Paints and previously acquired a small airfield outside of Berlin. The group has more than $4bn of assets, its website said.

Flacks’ fortune is worth more than £1.2bn, according to the Sunday Times rich list.

He recently acquired a 500 acre site next to the Teesside airport that formerly hosted a plant owned by the chemicals group Elementis. Flacks said he is planning significant investments to target renewable energy production and battery storage among other areas.

“It’s a forgotten part of Britain that’s about to explode in the next few years,” Flacks said. “It’s surfacing as a major renewable energy centre.”

The airport is of huge political significance to Teesside and to Houchen, who was re-elected earlier this month in local elections for a third term on a reduced majority.

In a statement, Houchen said in recent months there had been interest “from a number of firms wanting to invest in our airport and take a share in the ownership”, although he did not name Flacks.

He called the interest a “massive vote of confidence”, adding that in recent weeks officials “have done the diligent thing in assessing these proposals”. Nevertheless the airport would be “staying as it is”, he added.

“I have always been clear that the public should own Teesside Airport,” he said. “That is the mandate I have and that is how things should remain.”